[8] SERVICE CHARGE VS GST: CONSUMER CONFUSION IN RESTAURANT BILLING PRACTICES—AN EMPIRICAL STUDY

How to Cite : Geetha Bai A S & Mohana R K (2026). Service Charge vs GST: Consumer Confusion in Restaurant Billing Practices—An Empirical Study. International Journal of Multidisciplinary Research & Reviews, 5(8),70-82. https://doi.org/10.56815/ijmrr.v5i8.2026.70-82

Abstract

The increasing use of service charges alongside the Goods and Services Tax (GST) in restaurant billing has generated considerable confusion among consumers regarding their nature, applicability, and legal status. While GST is a statutory tax imposed by the Government of India, service charges are discretionary charges levied by restaurants and are governed by consumer protection guidelines. The present study examines consumer awareness and confusion regarding these billing components and assesses perceptions of transparency and fairness in restaurant billing practices. The study adopts a descriptive research design based on primary data collected through a structured questionnaire administered using Google Forms. A total of 114 responses were received, of which 107 valid responses were analysed using frequency and percentage analysis. The findings reveal that although a majority of respondents understand that GST and service charges are different, a substantial proportion continue to experience confusion while interpreting restaurant bills. The study further indicates overwhelming support for clear disclosure of service charge policies, voluntary payment of service charges, and stronger regulatory oversight to ensure transparent billing practices. The findings emphasise the importance of consumer education, standardized billing formats, and effective implementation of consumer protection guidelines. The study contributes to the literature on consumer behaviour and pricing transparency by providing empirical evidence on consumer perceptions of restaurant billing practices in India.